Bloomberg Law
Oct. 19, 2020, 1:34 PMUpdated: Oct. 19, 2020, 10:09 PM

Patent Office Considers New Rules for Denying Patent Reviews (2)

Ian Lopez
Ian Lopez
Senior Reporter

The U.S. Patent and Trademark Office is seeking comment on possible regulations for granting or denying patent tribunal validity trials, a process for which the agency has relied on precedent and practice guidance.

The Patent Trial and Appeal Board’s discretion to hold or deny a validity trial has been a major focus for the agency under director Andrei Iancu.

“Rulemaking will accomplish two things,” Michelle Armond, a founding partner at Armond Wilson LLP, said. “First, it will synthesize and clarify the patent office’s many decisions on institution. And second it will cement the director’s authority over institution.”

The announcement comes amid controversy over the PTAB’s use of discretion to pass on validity trials. Major tech companies have sued the patent office over the practice and asked Congress to investigate.

The agency, in a Federal Register notice set to publish Tuesday said it is “considering the codification of its current policies and practices, or the modification thereof, through rulemaking.”

The agency is asking for “comments on considerations for instituting AIA trials as it relates to serial and parallel AIA petitions, as well as proceedings in other tribunals.” The AIA, or the America Invents Act, is the law that created the PTAB.

Fintiv Fallout

Among the questions are whether the PTO should set a “rule with a case-specific analysis” on whether to hold a validity trial when a district court proceeding on the same patent is underway. The board set precedent in 2020 laying out factors to consider in Apple Inc. v. Fintiv Inc.

Companies that rely on the PTAB to challenge problematic patents have taken issue with the agency’s use of discretionary denials. Apple Inc., Google LLC and others sued the patent office over discretionary denials, particulary over considerations set out via the Board’s Fintiv and NHK Spring Co. v. Intri-Plex Techs., Inc decisions.

Among the tech companies’ arguments is that the “NHK-Fintiv rule” is invalid from a procedural standpoint, as it wasn’t adopted via notice and comment rulemaking.

The patent office is “essentially mooting that argument by commencing the process of notice and comment rulemaking,” said Kayvan Noroozi, founder of Noroozi PC.

Patent board practice rules have been a hot-button issue for the agency. The PTO proposed amendments to PTAB practice rules that are under review with the White House Office of Information and Regulatory Affairs. The contents of the proposal haven’t been made public.

Stakeholders meeting with OIRA on the proposed amendments included Computer and Communications Industry Association patent counsel Joshua Landau. CCIA was concerned about the direction of PTAB precedent involving the tribunal’s discretion to deny validity trials.

“The shift to a request for comments is reflective of them understanding that there is going to be significant pushback, to the point of suing the office,” Landau said.

Formal Rulemaking

The patent office in its announcement said it already has received input from stakeholders on employing its discretion to hold validity trials.

“In light of the various contrasting views from some stakeholders, the Office solicits further public input on what should be considered as part of a balanced assessment of the relevant circumstances when exercising its discretion to institute an AIA trial,” the agency said.

Also up for consideration are rules on serial and parallel petitions. The Patent Trial and Appeals Board previously addressed parallel petitions via its trial practice guide. The board addressed serial petitioning via precedent.

Using formal rulemaking “provides additional clarity, because otherwise you’re leaving it up to PTAB panels” to apply precedent, Tyson Benson, patent attorney at Bejin Bieneman PLC, said. PTAB judges could have different interpretations of issues, and the rule could provide more uniformity, he said.

Armond said that rulemaking also provides an opportunity to provide clarity about the PTAB’s “tremendous discretion” over instituting inter partes review proceedings.

“Those decisions generally can’t be reviewed by the appellate court” because of Supreme Court precedent, Armond said. And the PTAB has issued a slew of precedent and informative decisions on institution, she said.

“The law has evolved very quickly, and it can be very confusing to newcomers,” Armond said. “This rulemaking will try to provide clarity in this area.”

(Updated with attorney reactions.)

To contact the reporter on this story: Ian Lopez in Washington at

To contact the editors responsible for this story: Renee Schoof at; Keith Perine at